Method and apparatus for internet customer retention

Abstract

A method of dynamically optimizing customer retention for a web marketing site is provided. That method includes specifying a permissible defunct threshold, specifying a range of offers to be included in a set of promotions, determining a probability that a customer will become defunct in a predetermined period of time since the last interaction of that customer with the web site, and providing a promotion to a customer if the probability that the customer will become defunct in the predetermined period of time since the last interaction of that customer with the web site is greater than a predetermined threshold.

What is claimed is: 
     
         1 . A method of dynamically optimizing customer retention for a web marketing site, comprising:
 specifying a permissible defunct threshold;   specifying a range of offers to be included in a set of promotions;   determining a probability that a customer will become defunct in a predetermined period of time since the last interaction of that customer with the web site; and   providing a promotion to a customer if the probability that the customer will become defunct in the predetermined period of time since the last interaction of that customer with the web site is greater than a predetermined threshold.   
     
     
         2 . The method of  claim 1 , further comprising segmenting the sample population based on a characteristic of the customers sampled. 
     
     
         3 . The method of  claim 2 , wherein the characteristic is an amount that the customers spent at the web site in the past. 
     
     
         4 . The method of  claim 1 , wherein the last interaction includes accessing the web site. 
     
     
         5 . The method of  claim 1 , wherein the last interaction includes making a purchase from the web site. 
     
     
         6 . The method of  claim 1 , further comprising maximizing profit by optimizing an amount of discount offered in the promotion. 
     
     
         7 . The method of  claim 6 , wherein optimizing is performed continuously. 
     
     
         8 . The method of  claim 6 ,
 wherein optimizing includes sampling responses received from customers that are offered promotions of varying amounts; and   optimizing the promotion amount provided to other customers based on the optimum promotion amount discovered in the sample.   
     
     
         9 . The method of  claim 1 , wherein data related to whether a customer has interfaced with the web site is stored in the database. 
     
     
         10 . The method of  claim 1 , wherein an amount spent by a customer is stored in a database. 
     
     
         11 . The method of  claim 9 , wherein a customer is segmented for random sampling based on the amount spent by that customer.